Will the Euro Survive?

It looks like  Germany has approved its share of a trillion dollar rescue package for the Euro. Additionally, the EU has announced it will look at enforcing stiffer fines against countries that break its Stability and Growth Pact's deficit limits.

The Euro project was built with collectivist dreams from elitists who ignored voter concerns,  despite numerous countries rejecting the EU by referendum.  The EU dreamers thought they could ignore the geopolitics and residual nationalism in Europe and graft a superstate structure over it, binding everyone together for a more peaceful union.  Now we see the fault lines that arise in the Euro's project: the inevitable dilution of state sovereignty and widening democracy deficit between Brussels and individual voters.  Clive Crook from The Atlantic gets to the heart of the problem in his post, "Europe's Missing Foundations":

History and ordinary prudence dictated that the union might be broad and shallow (a free-trade area, with embellishments, capable of taking in all-comers) or else narrow and deep (an evolving political union, confined to countries willing to be led there). Of the two, I always believed that the first was better. But the architects did not even have the brains to choose the second. They recognized no limits to their ambitions. They set about creating a union that was both broad and deep. A federal constitution, a parliament, a powerful central executive, one central bank, one currency - all with no binding sense of European identity.  As for scale, well, the bigger the better. Today Greece, tomorrow Turkey. And why stop there? Madness.

Today's Telegraph predicts failure:

This is why the euro, in its current form, is finished. The game is up for a monetary union that was meant to bolt together work-and-save citizens in northern Europe with the party animals of Club Med. No amount of pit props from Berlin can save the euro Mk I from collapsing under the weight of its structural dysfunctionality. You cannot run indefinitely a single currency with one interest rate for 16 economies, when there are such huge fiscal disparities.

What was once deemed unthinkable is now, I believe, inevitable: withdrawal from the eurozone of one or more of its member countries. At the bottom end, Greece and Portugal are favourites to be forced out through weakness. At the top end, proposals are already being floated in the Frankfurt press for a new "hard currency" zone, led by Germany, Austria and the Benelux countries. Either way, rich and poor are heading in opposite directions.

It seems Germany and the EU elites are doubling down to save it. From the WSJ:

Berlin is now determined to push through a package of reforms both in Brussels and at the Group of 20 summit next month. These would cover stricter regulation of financial markets, a tax on financial institutions, and greater budgetary discipline.

But the German moves this week are already unsettling some. Says Struan Stevenson, a member of the European Parliament from the U.K.: "Clearly, the Germans were expecting other EU nations to dance to their tune and are no doubt enraged that others, including France, have chosen to ignore them.

"It's make-or-break time for the euro zone, with the tensions exposed by this crisis threatening to tear the single currency apart.

"My hunch is European leaders will not risk a market meltdown and bow to German pressure for full fiscal union—with Brussels and the European Central Bank in Frankfurt having the final say on state tax and spending plans across the euro zone."

Berlin would thus have achieved in months what has eluded the champions of the single currency since its inception.

As the WSJ notes, there is bound to be resistance from other member states to this.  The Euro will be unstable for the foreseeable future.